"Irrationality is cognition ,
thinking, talking or acting without inclusion of rationality .
It is more specifically described as an action or opinion given through
inadequate reasoning, emotional distress, or cognitive deficiency. The term is used,
usually pejoratively, to describe thinking and actions that are, or appear to
be, less useful or more illogical than other more rational alternatives."

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And what about this one? Market
Psychology ? This term is defined in the Investopedia this way:

"The overall sentiment
or feeling that the market is experiencing at any particular time. Greed, fear,
expectations and circumstances are all factors that contribute to the
group's overall investing mentality of sentiment."

Q: What do we have
when we put the two together?

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A: The current madness
and market mayhem,'

S&P's downgrade is
being blamed for the market panic even though all the business media expected a
downgrade and initially minimized its potential impact. The ratings agency
blamed the government's failure to deal with the debt including the stalemate
in Congress,

The Republicans,
predictably blamed Obama and the Democrats went after the Tea Party as the
culprits behind the market plunge. But then, investors who at first denied that
a downgrade would be significant overreacted to it by pumping more money into
government treasuries adding to government debt.

We are taught to think
of businessmen and their minions as absolute worshippers of objective truth as
they allegedly practice "due diligence" to confirm underlying facts and insure
that their decisions are based on research and thoughtful decisions.

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That's what we are
taught---but is that what they do?

In fact, the "smartest
guys in the room" as the Enronians were called proved to be the dumbest, buying
into a warped worldview, and then, believing their own hype leading to
decisions that brought the house down.

And that's what
happens again and again, over and over, as panic seizes The Street followed by
a herd of decision makers making bad decisions.'

News Dissector Danny Schechter is blogger in chief at Mediachannel.Org He is the author of PLUNDER: Investigating Our Economic Calamity (Cosimo Books) available at Amazon.com.
See Newsdisssector.org/store.htm.